Citi launches CNY trade settlement in Sri Lanka
The investment bank has launched its renminbi settlement platform in Sri Lanka to eliminate cross-currency exchange risks as trade volumes between the two nations continue to grow.
Citi’s Global Transaction Services implemented the Chinese currency trade settlement system to help Sri Lankan companies remove cross-currency exchange risk when transacting business between the two export-driven countries.
The service enables companies to open and maintain renminbi accounts with Citi and make payments directly to beneficiaries in the Chinese currency, according to a press release. This has been made possible by the approval of the renminbi as a settlement currency by the Central Bank of Sri Lanka in June 2011.
“We saw the recognition of the renminbi as a settlement currency by the Central Bank of Sri Lanka as an opportunity to help our clients eradicate currency exchange risks,” said Dilshan Seneviratne, Sri Lanka-based head of global transaction services at Citi in the press release yesterday (January 11). “This realisation drove the launch of the renminbi settlement services in Sri Lanka.”
In the first six months of 2011, trade between China and Sri Lanka was worth US$1.28 billion, a rise of 39.5% on the same period in 2010, according to Chinese customs data. China's imports from Sri Lanka in the first six months of 2011 were worth US$68 million.